Newton v Equititrust Limited - [2010] NSWSC 1075

CITATION: NEWTON v EQUITITRUST LIMITED [2010] NSWSC 1075

HEARING DATE(S): Wednesday 29 September 2010

JUDGMENT DATE :
1 October 2010

JURISDICTION: Common Law

JUDGMENT OF: Hall J at 1

DECISION: The summons is dismissed

CATCHWORDS: CONTRACTS – loan agreements and registered mortgage – proceedings by lender against borrower for order for possession and a monetary order – consent orders made in favour of plaintiff/lender on basis of settlement agreement – Contracts Review Act 1980 – subsequent application under Act to set aside consent orders and for leave to file amended defence and cross-claim raising a case of unconscionability of the loan agreements – loans advanced by plaintiff were development project funds for a property redevelopment of the subject property – whether borrower had an arguable case that she was in a position of special disadvantage as at the time of the loans – whether loans amounted to asset lending – a finding open that the settlement agreement was “unjust” under the Act having regard to medical and other evidence – however no basis for an order under s.7 setting aside the consent order s- no arguable case established of a case based on unconscionability in accordance with general law principles

LEGISLATION CITED: Contracts Review Act 1980

CASES CITED: Commercial Bank of Australia Limited v Amadio (1988) 151 CLR 447
Elkofairi v Permanent Trustee Co Limited [2002] NSWCA 413
Harvey v Phillips (1956) 94 CLR 235
Perpetual Trustee Company v Khoshaba [2006] NSWCA 41
Riz v Perpetual Trustee Australia Limited (2007) ANZ Conv R 615
State Bank of NSW v Drury (Ireland J, unreported 4 April 1996

PARTIES: KRISTINE LORRAINE NEWTON
v EQUITITRUST LIMITED

FILE NUMBER(S): SC 2010/325232

COUNSEL: P: M W Young
D: D Higgs SC/J King

SOLICITORS: P: Bransgroves Lawyers
D: Jackson Lalic Lawyers

LOWER COURT FILE NUMBER(S): 4189/09

LOWER COURT JUDICIAL OFFICER : Magistrate Price

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

HALL J

FRIDAY 1 OCTOBER 2010

2010/325232

KRISTINE LORRAINE NEWTON v EQUITITRUST LIMITED

JUDGMENT

1 HIS HONOUR: On 23 September 2010, I granted leave to the plaintiff, Ms Kristine Lorraine Newton, to file a Summons dated 23 September 2010. The orders sought in the summons relate to declaratory and other relief. Ms Newton, in particular, sought an order setting aside consent orders made by Davies J on 27 May 2010.

2 On 23 September 2009, I directed that the summons be heard on an expedited basis. That took place on Wednesday 29 September 2010. Mr D Higgs SC appeared with Mr J King of counsel for Ms Newton. Mr M W Young of counsel appeared on behalf of the defendant, Equititrust Limited (“Equititrust”). That company is the plaintiff in proceedings (referred to in this judgment as “the principal proceedings”) commenced by Statement of Claim filed on 22 September 2009 (proceedings No 2009/296415).

3 Before turning to the evidence and the issues arising on the Summons, it is necessary to refer to the background of the principal proceedings.

The…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Newton v Equititrust Limited

Details

AGLC: Newton v Equititrust Limited [2010] NSWSC 1075
Case: [2010] NSWSC 1075
Decision Date: 1 October 2010

CaseChat Overview and Summary

In the matter of Newton v Equititrust Limited, the dispute arose from loan agreements and a registered mortgage. Newton, as the lender, initiated proceedings against Equititrust Limited, the borrower, seeking an order for possession and a monetary order. Consent orders were subsequently made in favour of Newton based on a settlement agreement. Equititrust Limited then applied to set aside the consent orders and for leave to file an amended defence and cross-claim under the Contracts Review Act 1980. The borrower argued that there was an arguable case that she was in a position of special disadvantage at the time of the loans and that the loans amounted to asset lending. The central legal issues for the court to decide were whether Equititrust Limited had established an arguable case of unconscionability and whether the settlement agreement was "unjust" under the Act.

The court considered whether Equititrust Limited had established an arguable case of unconscionability according to general law principles. The loans were development project funds for a property redevelopment, and the court noted the borrower's special disadvantage at the time of the loans. However, the court found that while there was evidence to support the borrower's disadvantage, it did not establish a case of unconscionability in accordance with general law principles. The court determined that the settlement agreement was "unjust" under the Act, given the medical and other evidence presented. Despite this finding, the court concluded that there was no basis for setting aside the consent order under section 7 of the Act, as no arguable case of unconscionability had been established. Therefore, the application to set aside the consent orders was dismissed.

In light of the court's findings, the final orders were made. The consent orders previously entered in favour of Newton remained in place, and Equititrust Limited's application to set them aside was dismissed. The court ruled that while the settlement agreement was "unjust" under the Act, there was no arguable case of unconscionability based on the evidence presented. Consequently, the amended defence and cross-claim were not permitted, and the proceedings concluded with the original consent orders remaining effective.

Orders